Net flows into sector mutual funds and exchange-traded funds declined by 5.2% in 2011, according to a new report.
Cerulli Associates, Boston, Mass., published this finding in the February 2012 issue of “The Cerulli Edge: U.S. Monthly Product Trends Edition.”
The report finds that sector mutual funds and ETFs attracted $25.3 billion in 2011. This is down 5.2% from 2010's net inflow of $26.7 billion.
However, the report says that mutual fund assets in January recovered from the last two months of decline, growing 4.3%. In addition, flows into mutual funds turned positive during the month ($34.0 billion) after three consecutive months of net redemption.
Cerulli says that ETF sales were “very strong” in January, despite mutual funds’ outpacing ETF flows by $6.1 billion. U.S. stock ETFs posted $13.4 billion flows for the month, less than their last month’s inflow of $14.4 billion in December.
The report says that real estate, utilities and global real estate funds captured the first, second and third spots among the 14 sector mutual funds tracked by Morningstar. These funds secured $2.7 billion, $2.3 billion and $2.1 billion, respectively.
The report adds that ETFs garnered four times as much net flows ($20.6 billion) as sector mutual funds for the year. The top ETFs were utilities ($3.9 billion in net flow), equity precious metals ($3.7 billion), and consumer defensive funds ($3.1 billion).
Diversified emerging markets and high-yield, bond-focused ETFs boasted the highest flows in January, with $4.1 billion and $3.9 billion, respectively.